Daily Digest 5/28 - Greece Austerity Plan Fails, Gas Tanks Draining Family Budgets, Russian Grain Curbs End

• Greek leaders fail to agree as IMF deadline looms
• Too Big To Punish
• Gas tanks are draining family budgets
• Global Industrial Growth To Slow Soon
• Western Australia shuns Canberra, eyes China
• Peak oil and the Fall of the Soviet Union: Lessons on the 20th Anniversary of the Collapse
• Russia Grain Curbs Ending as Drought Wilts Europe Crops

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Economy

Greek leaders fail to agree as IMF deadline looms (Adam)

Greek leaders meeting in Athens have failed to agree on Prime Minister George Papandreou's new austerity plan.

Conservative leader Antonis Samaras rejected the measures, saying they would "flatten the Greek economy and destroy Greek society".

Mr Papandreou, a Socialist, had been trying to secure cross-party agreement for further cuts.

Too Big To Punish (Phil H.)

The new HBO film of the book Too Big To Fail by Andrew Ross Sorkin omitted several key factors in an otherwise suspenseful true-life drama depicting the near collapse of the American financial system. By now, most people who care about the crisis know the cast of characters: US Treasury Secretary Hank Paulson; Fed chief Ben Bernanke; Lehman Brothers chairman Dick Fuld; and the honchos who led Citibank, Merrill Lynch, JP Morgan Chase, Morgan Stanley, and a handful of others among the national banks outside New York.

Gas tanks are draining family budgets (Adam)

There's less money this summer for hotel rooms, surfboards and bathing suits. It's all going into the gas tank.

High prices at the pump are putting a squeeze on the family budget as the traditional summer driving season begins. For every $10 the typical household earns before taxes, almost a full dollar now goes toward gas, a 40 percent bigger bite than normal.

Households spent an average of $369 on gas last month. In April 2009, they spent just $201. Families now spend more filling up than they spend on cars, clothes or recreation. Last year, they spent less on gasoline than each of those things.

Global Industrial Growth To Slow Soon (Kelly J.)

A 63-country IMF study of the recession-forecasting prowess of economists concluded that their 'record of failure to predict recessions is virtually unblemished. Last year, they correctly predicted the slowdown that spooked stocks was a short term blip, and not a real downturn. Now ECRI's Lakshman Achuthan confidently predicts that global growth will peak by mid-summer and turn down after that.

Western Australia shuns Canberra, eyes China (Terry G.)

After a week in which Mr Barnett and Wayne Swan traded blows over Western Australia's infrastructure funding and declining share of GST receipts, the Premier said yesterday the Gillard government had "lost the plot" and relations had degenerated into an "unsavoury and unfriendly environment".

Western Australia was striking closer political and business relationships with China rather than the rest of Australia, which largely did not understand the profound economic transformation occurring in his state.

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Energy

Peak oil and the Fall of the Soviet Union: Lessons on the 20th Anniversary of the Collapse (Adam)

The causes of the fall of the Soviet Union are thought to be inefficiency and the Soviet response to the Reagan Administration’s military buildup of the early 1980s. However, a more plausible explanation is the decline in Soviet oil production caused by peak oil. This gives the world an example of a modern economy confronted by peak oil and what lessons we can learn from it.

Environment

Russia Grain Curbs Ending as Drought Wilts Europe Crops (Adam)

Russia, once the world’s second- biggest wheat exporter, plans to let a grain-export ban expire July 1 after almost a year, bolstering global supply as drought and flooding threatens crops from Europe to the U.S.

Farmers have sown 10 percent more acres and stockpiles exceed 6 million metric tons, First Deputy Prime Minister Viktor Zubkov said today, according to a government statement. Russian grain traders accelerated purchases in the last several weeks, moving supply to silos near ports in anticipation of the end of the ban which began in August, agricultural researcher SovEcon said May 20.

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